5. You have a business you are considering selling. There are several ways to determine the...

5. You have a business you are considering selling. There are several ways to determine the firms worth. Based on the following data, which method would merit you the most for your business.

2016 annual profits were $1,500,000
Your current stock is 35.00 per share
There are 35,000 outstanding shares of stock.
Your stock has earned $12 this past year, and
Average net income over five years $600,000

Consider in this calculation the Price/Ratio Method, outstanding share method, and the conservative rule of thumb. Show your work for each of these methods and identify, based on your work, which method yield you the most for your business.

Expert Solution

ekkarill92 answered 1 year ago

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